In 12 years, the fund that the grandfather placed $5,000 at an 8% rate of return will be worth $12,590.85.
<h3>What is the future value?</h3>
The future value refers to the value that investment yields at a compounded interest rate in the future.
The future value can be computed using an online finance calculator as follows, the future value formula, or the future value table.
<h3>Data and Calculations:</h3>
N (# of periods) = 12 years
I/Y (Interest per year) = 8%
PV (Present Value) = $5,000
PMT (Periodic Payment) = $0
<u>Results:</u>
FV = $12,590.85
Total Interest = $7,590.85
Thus, in 12 years, the fund that the grandfather placed $5,000 at an 8% rate of return will be worth $12,590.85.
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